Value
8.2/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.5 |
| P/S | 10.0 |
| Fwd P/E | 9.5 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 8.5x
- ▸PEG: 0.18
- ▸Attractively valued
PBF · Why this verdict
Why PBF Energy (PBF) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.6/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
PBF Energy has beaten earnings in all 4 of the last 4 quarters with an average positive surprise of 149%, including a 550% beat in one quarter, while trading at a forward P/E of 7.0x and PEG of 0.14 — suggesting the market meaningfully underestimates near-term earnings power. Earnings | The company beats consensus EPS estimates in at least 3 of the next 4 quarters, maintaining the majority-beat pattern. | →Stable |
| CounterBeats against deeply negative estimates (three quarters had negative EPS estimates) are less informative than beats against positive estimates; the underlying refining margins may remain structurally challenged regardless of quarterly beat ratios. | ||
PBF's quality score has fallen to the 2.0 floor level with negative free cash flow at 200% relative to net income — a red flag that despite GAAP earnings beats, the company is consuming more cash than it generates from operations. Quality breakdown | Free cash flow turns positive and sustains above zero for at least 2 consecutive quarters, resolving the quality floor concern. | →Stable |
| CounterNegative free cash flow at 200% of net income in a commodity business with 15% short interest suggests the bear case is well-known and may intensify if refining cracks continue to compress. | ||
With 15% of shares sold short and the quality concerns well-flagged, a positive earnings or margin catalyst could force a short-covering rally that amplifies price gains above what fundamentals alone would deliver. Risk breakdown | Short interest falls below 10% within 12 months as the bearish thesis is reduced by improving refining margins or cash flow. | →Stable |
| CounterHigh short interest in refining companies near cycle lows is often justified; 15% short with no edge identified and failed momentum suggests the bears have a structural thesis rather than a positioning overhang. | ||
The stock experienced an extreme gap down of 6.5% that technical analysis flags as a potential reversal signal, combined with a Bollinger score of 7.6 indicating the price may be at or near a short-term support extreme. Technical breakdown | Price recovers above $43 within 60 days of the gap-down event, filling the gap and confirming the reversal signal. | →Stable |
| CounterGap-downs with failed momentum gates in quality-floor names frequently continue lower rather than reverse; the absence of a news-driven catalyst makes this a technical pattern rather than a fundamental inflection. | ||
PBF Energy has beaten earnings in all 4 of the last 4 quarters with an average positive surprise of 149%, including a 550% beat in one quarter, while trading at a forward P/E of 7.0x and PEG of 0.14 — suggesting the market meaningfully underestimates near-term earnings power.
→StableEarnings
- Expectation
- The company beats consensus EPS estimates in at least 3 of the next 4 quarters, maintaining the majority-beat pattern.
CounterBeats against deeply negative estimates (three quarters had negative EPS estimates) are less informative than beats against positive estimates; the underlying refining margins may remain structurally challenged regardless of quarterly beat ratios.
PBF's quality score has fallen to the 2.0 floor level with negative free cash flow at 200% relative to net income — a red flag that despite GAAP earnings beats, the company is consuming more cash than it generates from operations.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive and sustains above zero for at least 2 consecutive quarters, resolving the quality floor concern.
CounterNegative free cash flow at 200% of net income in a commodity business with 15% short interest suggests the bear case is well-known and may intensify if refining cracks continue to compress.
With 15% of shares sold short and the quality concerns well-flagged, a positive earnings or margin catalyst could force a short-covering rally that amplifies price gains above what fundamentals alone would deliver.
→StableRisk breakdown
- Expectation
- Short interest falls below 10% within 12 months as the bearish thesis is reduced by improving refining margins or cash flow.
CounterHigh short interest in refining companies near cycle lows is often justified; 15% short with no edge identified and failed momentum suggests the bears have a structural thesis rather than a positioning overhang.
The stock experienced an extreme gap down of 6.5% that technical analysis flags as a potential reversal signal, combined with a Bollinger score of 7.6 indicating the price may be at or near a short-term support extreme.
→StableTechnical breakdown
- Expectation
- Price recovers above $43 within 60 days of the gap-down event, filling the gap and confirming the reversal signal.
CounterGap-downs with failed momentum gates in quality-floor names frequently continue lower rather than reverse; the absence of a news-driven catalyst makes this a technical pattern rather than a fundamental inflection.
TrendMatrix Research · core thesis
Engine thesis — one sentence
PBF Energy has beaten earnings estimates in all 4 of the last 4 quarters with an extraordinary average surprise of 149%, and trades at a forward P/E of 7.0x — but quality metrics are at the floor level with negative free cash flow and a failed momentum gate, making this a deep-value turnaround with significant execution risk.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
2.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.7 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 0.0 |
| Net margin | 0.7 |
| Current ratio | 4.9 |
| FCF quality | 0.0 |
| Moat | 5.6 |
| Piotroski F | 4.4 |
- ▸Earnings quality RED FLAG: -200% FCF/NI
- ▸Quality concerns
Growth
7.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.5 |
| EPS growth | 10.0 |
Momentum
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 3.5 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.5 |
| Analyst rating | 5.0 |
| Price target | 4.2 |
Insider
3.0/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Heavy insider selling — $53,503,689 (0.946% of mkt cap)
Peer rank
5.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.8 |
| quality rank | 3.9 |
| growth rank | 6.1 |
Technical
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.2 |
| support resistance | 1.0 |
| 52w position | 8.4 |
Risk (lower is worse)
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 2.0 |
| days to cover | 4.7 |
| volatility | 0.2 |
| put call | 10.0 |
| implied vol | 0.0 |
| beta | 10.0 |
| debt equity | 7.2 |
- ▸High short interest justified: 15%
- ▸High IV: 81%
Catalyst
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 5.2 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 230.0%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (5)
- MOMENTUM:7.5>=5.5
- 8K:CLEAN
- EARNINGS_PROXIMITY:24d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-1.2=NEGATIVE
- INSIDER:0.95%=HEAVY
Warning (0)
none
Reward-to-Risk
-1.17
Upside
-17.6%
Downside
15.0%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 68, MACD bullish
EdgeCatalyst-Driven — Earnings in 24d with 4/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 8.2 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:-1.2=NEGATIVE.
The strongest dimensions are Value at 8.2, Growth at 7.8, and Momentum at 7.5; the weakest are Quality at 2.0, Insider at 3.0, and Technical at 3.2. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -1.17 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Beat Streak Deep Value
Trip ifEarnings miss consensus by more than 15% in 2 of the next 4 quarters, breaking the beat streak.
- P2Quality Floor Fcf Concern
Trip ifFree cash flow remains negative for more than 3 consecutive quarters, confirming the cash burn is not transient.
- P3High Short Interest Risk
Trip ifShort interest rises above 20% of float, indicating accelerating bearish conviction beyond the current level.
- P4Technical Gap Reversal Signal
Trip ifPrice drops below $34 within 60 days of the gap-down, confirming the technical reversal signal failed.